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[Alpha Biz=(Chicago) Reporter Paul Lee] Korea Investment & Securities has significantly lowered its target price, citing a lack of research and development (R&D) momentum. The investment opinion remained 'buy', but the target price was 100,000 won, down 16.7% from 120,000 won in January.
"It (lowering the target price) is partly attributable to a drop in the average price of major pharmaceutical companies due to weak investor sentiment across the pharmaceutical sector, but the biggest reason is the lack of R&D momentum, the biggest factor that determines corporate value," Korea Investment & Securities Co. said in a report. "The development stage of pipelines is still in the early stages compared to the annual R&D costs, and it will take some time to confirm its effectiveness," he added.
Korea Investment & Securities predicted that Chong Kun Dang (185750)'s second-quarter earnings would exceed the consensus. The company presented sales of 382.8 billion won and operating profit of 39 billion won in the second quarter.
Alphabiz Reporter Paul Lee(hoondork1977@alphabiz.co.kr)
